Accounting Profit and Business Profit
4.80
2 Reviews
Participants examine distributions and loans to owners, their impact on net income, debt repayment, and income tax obligations, and assess borrower financial prospects.
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Certificate
0.5 Credit
Cost
1 hr.
Duration
n/a
Prep Time
1
Quiz
Overview
In this short self-study course, participants examine the purpose and role of distributions and loans to owners and partners. They identify the impact such distributions and loans have on reported net income and borrower debt repayment prospects. In addition, they explore the income tax impact from distributions and loans to owners on reported taxable revenue and associated personal income tax obligations.
Who Should Take This Course
Analysts and lenders interested in understanding the purpose and role of both distributions and loans to owners and partners of non-Subchapter C business organizations and the resulting impact of these operating expenses "hidden" on the balance sheet on a borrower's actual bottom line profit and debt service prospects.
Prerequisites
Familiarity with accrual financial statements and common performance ratios.
Objectives
By the end of the course, participants will be able to:
- Identify the role of distributions for Subchapter S corporations, partnerships, limited liability companies, and sole proprietorships.
- Determine the necessary adjustments to reported net profit to account for distributions in arriving at an estimate of actual business profit as well as identify the income tax implications for owners and partners who receive distributions from their companies.
- State the role of loans to owners and partners, their relationship to distributions, and their impact on actual business profit for Subchapter S corporations, partnerships, limited liability companies, and sole proprietorships.
Materials(access provided with registration)
- Credit Refresher on Accounting Profit and Business Profit
- Online Quick Hit Review Quiz
- Webinar Poll Solutions
- Exercise Solutions
